Global Shipbuilding Orders Reach $133 Billion in H1 as Fleet Value Hits $2.5 Trillion: Clarksons

The global shipping market recorded intense investment activity in the first half of the year, with new shipbuilding orders totaling $133 billion and secondhand vessel sales reaching $35 billion, according to data from Clarksons Research. The combined value of the current global fleet and outstanding orders has now climbed to an estimated $2.5 trillion.

Robust Market Activity

The volume of newbuild orders signals a period of strong growth for shipyards, which are projected to deliver vessels worth approximately $179 billion in 2025. Looking further ahead, Clarksons Research estimates that the shipping industry will require over $2.2 trillion in investment over the next five years to meet fleet renewal and expansion needs.

This activity is supported by the healthy financial state of shipping companies. According to the report, most operators maintain strong capital positions with ample cash reserves and have kept financing leverage at relatively prudent levels. This financial strength has allowed many firms to prepay existing debt, slightly reducing their overall demand for new financing.

A Borrower's Market for Financing

The ship financing market remains highly active and competitive, creating favorable conditions for borrowers. Intense competition among lenders has led to more attractive financing terms for vessel owners.

Key highlights of the financing landscape include:

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• European banks remain the largest source of capital, though their overall market share has declined.
• Asian banks and regional lenders have increased their participation and financing scale.
• Chinese leasing companies and export credit agencies (ECAs) have become major, diversifying players in the global market.

Clarksons Research notes that the market is expected to remain a "borrower's market" in the short term, supported by solid industry fundamentals and abundant liquidity.

Financing Terms and Outlook

Competition for top-tier clients is particularly fierce, resulting in highly competitive borrowing costs. According to the research, some of the most creditworthy clients are securing financing at rates as low as SOFR plus 100-150 basis points, a level not seen since the early 2000s.

Other lenders offer more flexibility on terms related to owner qualifications, vessel age, and asset type, but at a higher cost, with interest rate spreads often exceeding 400 basis points. While loan-to-value (LTV) ratios have risen, Clarksons advises that lenders should remain cautious in their project assessments and vessel valuations, given that asset prices in most segments are already at elevated levels.